By

Catherine Ngo

Content writer, presenter and podcaster

While the shift to remote work has benefited many, it has also brought challenges like isolation, disconnection, and instability. Employee experience must cater to these individual needs. 

How can Australian businesses support employees during critical moments, offering true flexibility in the workplace? Mercer’s comprehensive Australian Benefits Review Report offers three benefit trends for employers to consider:

1. The evolving paradigm of work-life integration

In 2023, 54% of organisations said ‘work-life balance’ was among the most fitting descriptors for their internal culture – up from 43% in 2019. 

This signals a greater focus on people rather than purely on business results, coupled with a greater understanding that work-life balance looks different, depending on each employee’s life situation. That’s why a work-life balance culture must have flexibility built in. Employees can then choose a work pattern that suits their needs and find a healthy and manageable balance whilst balancing business needs.

Mercer examined the correlation between practical benefits and employee programs in driving meaningful employee experiences in its A Pulse of Total Well-being. The study found that successful employers nowadays offer a comprehensive “Thrive Contract” that addresses employee well-being needs. However, this approach is evolving into a broader “Lifestyle Contract” encompassing employee choices, connections, and contributions, aiming for personal fulfilment. 

The growing trend toward a work-life balance culture suggests that this holistic life experience focus may soon become the norm for employee engagement.

2. The future is flexible: one in three would give up pay for flexibility 

Flexible working arrangements are here to stay. Eighty-three per cent of companies now have a formal policy, up from 69% in 2019, covering diverse, flexible working hours options – from ongoing flexitime to four-day work weeks and work-from-anywhere models. 

Mercer’s research found that one in three employees would give up a pay increase in return for a fully flexible or compressed workweek. Of those with a formal flexibility policy, 82% offer ongoing flexitime, up from 77% in 2019. Sixty-nine per cent also offer incidental flexitime (working shorter hours one day for personal reasons and making up those hours on another) – this is down from 76% in 2020, perhaps as ongoing flexitime has become more prevalent.

Employers are offering “ongoing flexitime.”

The idea of a four-day workweek is gaining traction, with 28% of employers offering a compressed workweek, and research suggests that this trend may continue. 

Time off in lieu has also become more prevalent, with 62% of employers offering longer lunch hours or entire days off. However, part-time employment options have decreased from 75% in 2019 to 61% in 2023. Employers’ challenge is ensuring that flexible working hours are equitable for all.

Employers to refine the hybrid work model. 

Employers must cautiously implement mandatory return-to-office policies in light of remote work preferences. A third of Australian organisations have such policies, with a median of three office days per week. The focus has shifted to ensuring employee satisfaction with new workplace expectations. Flexibility to work from home is now the second-most important factor for employee retention. Mandatory policies may pose challenges for those relocated due to lifestyle or family reasons. Some employers have tried “work from anywhere” policies but found it unsustainable for all employees. Clear communication and expectations are essential. 

3. Well-being in the moments that matter 

Beyond health and wellness support, workplace well-being encompasses flexible work arrangements that promote balance. Despite this, most well-being benefits, such as health checks, education, and apps, primarily concentrate on physical health. There is a need to address unmet social, financial, and emotional well-being needs, especially for employees with caregiving responsibilities. Almost all companies offer an Employee Assistance Program (EAP), and more than two-thirds have formal health and wellness programs that focus on health and wellness.

New health benefits are emerging – including health apps (such as meditation apps or sleep aids) offered by 30% of Australian Benefits Review participants, and stress and personal work-life management programs provided by 25%.

Offering wellbeing leave 

 

In recent years, organisations have recognised the importance of leave as a valuable employee benefit to promote emotional, physical, and financial well-being. In 2023, 22% of Australian Benefits Review participants reported offering additional paid leave to support wellness, representing an increase from 15% in 2021.

Some Australian organisations also offer extended parental leave benefits, exceeding statutory requirements. For instance, some employers provide up to 30 weeks of paid parental leave. Additionally, 87% of organisations contribute to superannuation during parental leave, with 61% providing these contributions only during the paid portion.

To address family domestic violence faced by employees, more than two-thirds of organisations have implemented formal policies. There has been a significant increase in paid leave supporting this issue. Currently, 86% of organisations offer paid leave, with a median leave of 10 days, which aligns with the Fair Work Amendment (Paid Family and Domestic Violence Leave) Act 2022.

Beware of caregiver burnout.

The increasing pressure on caregivers in Australia, especially women aged 45 to 65, is a significant issue. With one in eight working Australians caring for children or elderly parents, the impact on the workforce is undeniable. 

Despite this, most organisations (89%) do not offer childcare assistance. Only 9% provide employee assistance with elder care responsibilities, and even fewer (6%) support employees managing disability care responsibilities. As Australia’s population ages, the need for greater care and support for caregivers is evident. Unplanned leave, loss of productivity, and retention issues can arise when caregiving responsibilities are not adequately addressed.

Organisations must recognise the importance of providing comprehensive caregiving support to ensure a healthy and productive workforce.

Key takeaways and next steps

The first step is understanding employee needs, which is crucial for designing a benefits program that meets their diverse requirements. Satisfied employees contribute positively to the organisation’s overall success.

Employers can conduct regular surveys and hold check-in meetings to gather employee feedback on their benefits, needs, and preferences. This continuous engagement demonstrates that their opinions matter and helps tailor the benefits program accordingly. 

Additionally, benchmarking your employee benefits helps you assess the competitiveness of your benefits package against industry standards and identify areas for improvement. 

Employers can compare their benefits package with industry leaders in Australia. Look at the types of benefits offered, contribution levels, and any unique perks or programs. 

Lastly, don’t forget to align employee benefits with your company’s values, mission, and purpose, creating a strong employer brand and differentiating you from competitors. It fosters a sense of belonging and shared purpose among employees.

More information on Mercer’s comprehensive Australian Benefits Review Report can be found here: 

Catherine Ngo

Content writer, presenter and podcaster

Catherine is passionate about unravelling the latest news and insights to help HR managers, business owners, and employers.